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Russia Holds Key Rate Unchanged

Russia’s central bank left its key interest rate unchanged in October after hiking it in a surprise move in the previous month.

The Board of Directors decided to hold the key rate at 7.50 percent, the Bank of Russia said in a statement on Thursday, in line with economists’ expectations.

In September, the rate was hiked by a quarter-basis point, which was the first hike since 2014.

“The domestic financial market has stabilized in the time since the previous Board meeting,” the central bank said. “However, pro-inflationary risks remain elevated, especially over a short-term horizon.”

The uncertainty over future external conditions persists, the bank added.

The Bank of Russia forecast annual inflation to be 5-5.5 percent in 2019 and return to 4 percent in 2020.

The bank said it “will consider the necessity of further increases in the key rate, taking into account inflation and economic dynamics against the forecast, as?well as?risks posed by?external conditions and the reaction of financial markets.”